Pondering the Sustainable Consumption Conundrum

 

Two steps forward jpeg
Joel Makower gets into the impact of the recession and the current environment on sustainable consumption and the challenges businesses face in communicating with their consumers.

Posted Dec. 27, 2008
By Joel Makower, Two Steps Forward

I'm not sure whether it was strategic or serendipitous that the
World Business Council on Sustainable Development released a report on
sustainable consumption just a week before a recessionary Christmas — a
time when countless millions were torn between the desire to shop and
insufficient means to do so. Either way, it made for enhanced reading
of what already was a pretty enlightening report.

The report's unimaginativeSustainable consumption pic jpeg title "Sustainable Consumption: Facts and Trends" (download – PDF),
belies a bold premise: that companies need to start looking beyond
"greening up" their products and services and begin embedding
sustainability principles into their core business models — "delivering
sustainable value to society and consumers, helping consumers to choose
and use their goods and services sustainably, and promoting sustainable
lifestyles that help to reduce overall consumption of materials and
resources."

That's a tall order, one not easily achieved with the mindset of
today's business leaders, or the incentives given most business leaders
to grow at any cost. It's hard to imagine the preponderance of today's
global companies shifting their business models to this degree, not to
mention the preponderance of consumers deciding that maybe "having it
all" doesn't necessarily refer merely to "stuff."

Or will the current economic meltdown change things? Is there a
scenario in which global consumption patterns could change to embrace
more sustainable products and levels of consumption? That's the
trillion-dollar question.

Pondering the sustainable consumption conundrum is not new stuff for the WBCSD, a membership organization comprised of roughly 200 of the world's largest companies.
For more than a decade, the group has brought together corporate giants
like addidas, 3M, British Telecom, Henkel, Johnson & Johnson,
Nokia, Procter & Gamble, and Sony to study the means by which
companies can not only reduce the impacts of their products, but create
new ones that meet the needs of those in both developed and emerging
economies with little or no environmental and social impacts.

As far back as 1995, the group issued a policy statement noting that

Sustainable production and consumption involves
business, government, communities, and households contributing to
environmental quality through the efficient production and use of
natural resources, the minimization of wastes, and the optimization of
products and services. The WBCSD recognizes the need for business to
take a leadership role in promoting sustainable patterns of production
and consumption that meet societal needs within ecological limits.
Business can best work towards these goals through responsible
environmental management, enhanced competitiveness and profitable
operations.

The response over the ensuing 13 years has been steady, albeit
underwhelming, progress. Most manufacturers have made gradual
efficiency improvements, reducing the waste, energy, water, materials,
toxicity, and carbon embedded in their products and processes.
Pollution prevention and "eco-efficiency" have been the watchwords, as
companies found they could lower costs and reduce risks by cutting or
eliminating emissions and other waste streams. Some companies have
heralded their accomplishments through green marketing. Most don't
bother, given that their successes amount to not much more than "doing
less bad," a tough tale to spin.

But the WBCSD's newest report takes a notable turn. "This report
signals a shift in the nature of the sustainable consumption agenda
from the introduction of niche products and services to the embedding
of sustainability principles into the core business model," it notes.
In other words: "greening up" isn't good enough.

It's not that eco-efficiency isn't needed, says the WBCSD. It's
necessary, but not sufficient. What's needed is a three-pronged
approach:

  • Innovation — Increasing the availability of more
    sustainable products and services through integrating sustainability
    and life-cycle processes into product design innovation that doesn't
    compromise on quality, price, or performance in the market. "Business
    processes for the development of new and improved products, services,
    and business models are shifting to incorporate provisions for
    delivering maximum societal value at minimum environmental cost," it
    reports.
  • Choice Influencing — Creating a market for
    sustainable products and business models by working in partnership with
    consumers and other key stakeholders to demonstrate that sustainable
    products and lifestyles deliver superior performance at the best
    prices, and using marketing communications to influence consumer choice
    and behavior.
  • Choice Editing — Eliminating unsustainable
    products, product components, processes, and business models in
    partnership with other actors in society, such as policy-makers and
    retailers.

    Each of these three prongs strike me as an order of magnitude more
    difficult than the one before it. As I see it, Innovation — the growth
    of more sustainable products (a term, some would argue, that is
    oxymoronic: something either is, or isn't, sustainable) — is well
    underway. Each year, we see a steady parade of goods that are more
    energy efficient, less packaged, or require fewer resources in their
    manufacture, use, and disposal.

    Choice Influencing — creating a market for next-gen green products
    that transform markets and engender radical innovation, new business
    models, and changes in customer behavior — is an ideal that never seems
    to become reality. Companies are inherently timid to disrupt consumers'
    routines, and consumers seem too comfy in their purchases and habits to
    make even smallish shifts in their behavior, even when it leads to
    better outcomes and experiences. It's up to disruptive technologies —
    the iPod and iTunes come to mind — to shift both market and individual
    behavior. Even then, the incumbents (e.g., record companies) will drag
    their feet for years in the name of preserving their dwindling market
    share.

    The third prong, Choice Editing — "editing out" unsustainable
    products and processes — seems a pipe dream, a long slog of a journey
    that no one — corporate and political leaders alike — seem willing to
    undertake, let alone press others to do so, too.

    Will the current economic turmoil change that dynamic? Will
    companies and consumers, chastened by their reversal of fortune, be
    more willing to consider new ways and means of production and
    consumption? For example, will citizens see virtue — for themselves and
    their communities — in community gardens, car-sharing, lending
    libraries for tools, local banks, and other co-operative and
    collaborative forms of conducting commerce? Will they open themselves
    to quality, not quantity, thereby changing the value propositions by
    which they shop?

    Like I said, it seems a far-off vision, even on my more optimistic days.

    The WBCSD is quick to point out the institutional barriers to this transformation. Among them:

    There is currently no common understanding of
    what a sustainable product or lifestyle is. Business may determine the
    sustainability of a product based on a full life cycle analysis.
    Retailers, governments, and other actors may assess the
    "sustainability" or "un-sustainability" of a product based on varying
    disclosure criteria or societal pressure. As a result of this confusion
    over who determines the sustainability of a product, choices to edit
    the availability of certain products are often in conflict. Business,
    governments, and society (including consumers) must work together to
    define sustainable products and lifestyles.

    Clearly, it won't be easy, but the opportunities seem limitless for those that get it right. As I wrote in my new book:

    To a large extent, this is the ultimate
    green-economy strategy — enabling customers to reduce their impacts by
    doing business with your company. What is the opportunity to create
    products or services that become the green default — the no-brainer
    option that is better and greener? What is the opportunity to
    be disruptive — changing the economics, the business model, the market
    perception in a way that renders such barriers as the unaffordability
    and inconvenience of "going green" moot? What is the opportunity to
    create products that solve customers' problems — enabling them to
    fulfill their needs in a way that makes them genuinely part of the
    solution?

    Any ideas?

  • No comments yet... Be the first to leave a reply!

    Leave a Reply